Acknowledgement
I have taken efforts in this project. However, it would not have been possible without the kind support and help of many individuals and organizations. I would like to extend my sincere thanks to all of them.
I am highly indebted to prof. A. Deepak for his guidance and constant supervision as well as for providing necessary information regarding the project & also for his support in completing the project.
Introduction:-
The word ‘Retailing’ has become a buzzword nowadays in India. Indian retail sector has an
Enormous influence on economic condition of the country. The retail industry has reached a very critical stage in India. Stores in modern formats have emerged in the metropolitan cities but the maximum Retail Business happens through traditional retail formats till today.
A nation of savers, India has now become a nation of spenders; the rate of growth of spending on discretionary items has been growing at an average of nine per cent per year over the past five years. India’s vast middle class and its almost untapped retail industry are key attractions for global retail giants wanting to enter newer markets.
The Term Paper on Koutons Retail India Limited
... company went public in early 2006 and thereby became Koutons Retail India Limited (KRIL) with effect from June27, 2006. KRIL is primarily ... outlet of Koutons opened 2006 – IPO. Name changed to Koutons Retail India ltd in June 27, 2006 2007 – Listed on BSE and ... been allotted a manufacturing facility in Gurgaon at a total project cost of Rs 301. 85 million. Koutons has benefitted heavily ...
The word ‘retail’ is derived from the French word ‘retailer.’ It means ‘to cut a piece off’ or ‘to break bulk.’ In simple terms it is an activity and platform whereby product or services are sold to final consumers after breaking the bulk in small quantities. Retailing is tap at the end of the pipeline of the supply or distribution channel where customer finally purchases the product or service according to his or her need. The customer can be individual or even an organization and mostly families are the target customers.
Retail has played a major role to the world economy by increasing productivity across a wide range of consumer goods and services. It is the largest and oldest private industry in the world, with total sales of US $6.6 trillion.
Retailing in India—
The traditional Indian local markets and Kirana stores are witnessing a retail revolution. With the changing demographics and an increase in the quality of life and culture of urban people, grocery or home items shopping no longer means neighborhoods markets or shops. Who introduce the revolution are chains like Big Bazaar, Food world, Shoppers Stop, Star India Bazaar, and Adani supermarket and hypermarket. Retail is the country’s largest source of employment after agriculture, has the deepest penetration into rural India, and generates more than ten per cent of India’s GDP. With close to 12 million retail outlets, India has the highest retail outlet density in the world. The Indian retail sector is worth roughly Rs10000 Billion, and roughly two per cent of this is classified as organized retail.
Top Ten Retailers Worldwide
Rank | Retailer | No. of storesowned | Revenues in FY-04 US$(million) |
1 | Wall-Mart Stores Inc. (USA) | 5189 | 285222 |
2 | Carrefour Group (France) | 6987 | 90297 |
3 | The Home Depot, Inc | 1890 | 73094 |
4 | Metro AG (Germany) | 2300 | 70093 |
5 | Royal Ahold (Netherlands) | 4000 | 64615 |
6 | Tesco PLC (UK) | 1800 | 62284 |
7 | The Kroger Co. (USA) | 3763 | 56434 |
8 | Sears, Roebuck and Co. (USA) | 1970 | 55800 |
9 | REWE Handelsgruppe (Germany) | 11530 | 50698 |
10 | Costco Wholesale Corp. (USA) | 442 | 48107 |
The Indian Retail industries in all retail mix. Market liberalization and an increase in consumer population is now sowing the seeds of a retail change in India and it has already started through bigger Indian and multinational players. With the advent of these players, the Indian consumer is on his way to become the King of the market place as what his counterparts in the more developed countries of the world have been for decades. The Indian consumer is changing rapidly. The average consumer today is richer, younger and more aspirational in his or her needs than ever before. Consumers now value convenience and choice on a par with getting value for their hard earned money. A range of modern retailers is attempting to serve the needs of the ‘new’ Indian consumer. Consumers have started demanding a better shopping experience as global media.
The Review on Indian Footwear Industry
... India will continue to be market driven. The European countries and the US are major consumers for the Indian footwear. Indian footwear industry poised for growth:- India ... source their products from India. 4. 1. 5 CUSTOMER SEGMENTATION Retail footwear segment in Indian is very price sensitive ... AND RECOMMENDATIONS * It has been seen that retail formats give preference to their company managed EBO's ...
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Consumer research shows supermarkets and other modern retail channels effects like a magnate for the households in metropolitan cities. The growth is likely to be driven by increasing incomes, growing exposure to overseas markets, availability of credit cards,
The various segments that make up the organized retail industry along with their size are in figure 4. Retail growth is already gathering momentum and the organized retail industry is expected to grow by 30 per cent in the next five years and had touched Rs. 45,000 crore in 2005. Thus, the growth potential for the organized retailer is enormous.
Market Size of the Retail Segment |
|
Segment Market Size (Rs. Crore) |
Textiles and clothing’s 4050 |
Jewellery 2,000-2,500 |
Consumer Durables 1500 |
Footwear 1,300-7,500 |
Food and personal care 1000 |
Non-Store retail 900 |
The Essay on How Has the Personification of India and the Indian Woman Been Reflected in the Various Paintings of Mother India?
“I am India. The Indian nation is my body. Kanyakumari is my foot and the Himalayas my head. The Ganges flows from my thighs. My left leg is the Coromandal Coast, my right is the Coast of Malabar. I am this entire land. East and West are my arms. How wondrous is my form! When I walk I sense all India moves with me. When I speak, India speaks with me. I am India. I am Truth, I am God, I am Beauty.” ...
Luggage, watches and tyre 500 |
Books and music 390 |
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Factors Responsible for the Development of the Retail Sector in India
Amongst the least saturated of all major global markets in terms of penetration of modern retailing formats, is the advantage to Indian retail industry. An A T Kearney study on global retailing trends found that India is the least competitive as well as least saturated of all major global markets. There are significantly low entry barriers for players trying to set up business here, in terms of the competitive environment. India is among the top five emerging retail market in the world and is growing like anything.
The key drivers of growth of Indian retail industry:
• Rising income levels
• A large segment of young population
• Nuclear family structure
• Growing literacy
• A rapidly expanding middle class
Economic Research (NCAER) classified approximately 50 per cent of the Indian population as low income in 1994-95; this is expected to decline to 17.8 per cent by 2006-07. Thus the rise in earnings and better living conditions also affects on retail industry.
Liberalization of the Indian economy, which has led to the opening up of the market for international consumer goods, has helped the international brands and international store players in retailing to play significant role to the vast consumer market by offering a wide range of choices and design of retail format to the Indian consumers. Shift in consumer demand to foreign brands also revolved the retail industry in India.
Growth of Organized Retailing in India
According to the Study undertaken by The ASSOCHAM (Associated Chambers of Commerce and Industry of India), the organized retail sector is expected to grow at six per cent by 2010 and touch a retail business of $17 billion as against its current growth level of three per cent which at present is estimated to be $6 billion. The Study has revealed that the overall retail sector will grow at GDP seven per cent by 2010 and enlarge its market share to $280 billion from its present estimated level of $200 billion Gurgaon district is situated in NCR of Delhi, which has initiated organized retail boom in Delhi and NCR in the form of malls as over half a dozen operational malls like MGF Metropolitan Mall, MGF Plaza, Sahara Mall, DLF Mega Malls, Gold Souk are in Gurgaon.
The Essay on Fdi Retail In India
FDI in retail is the best opportunity of reviving Indian Economy Slokham dreamt 7 gave us Bhakra Nangal, Right Brothers dreamt & gave us aero plane I too dream, yes I dream to live in a fully developed India Seeing it emerge as an economic superpower, Viewed by the world as the land of prosperity & plenty. My dear listeners the boon, the blessings of FDI will make my dreams a reality. Good ...
With supermarkets like Apna Bazaar, Sahakari Bhandar, nine to nine, Food World, Nigam’s supermarket and Margin Free shops providing easy access to goods at lowest ever prices, with few even providing a constant supply of imported goods, the organized sector does attract the actual Indian Consumer’s attention who is always looking for bargaining it has been observed that as income levels rise, the share spent on food and grocery in the total household income declines and the proportion of income spent on lifestyle-related activities increases. Indian consumption patterns are no exception to the rule. Spending on consumer durables, apparel, entertainment, vacations and lifestyle products have increased in India.
Expenditure Pattern of Indian Urban household
Food World and Music World are set to more than double their network, while Shoppers’ Stop is gearing up for an expansion of 15 to 17 outlets all over the country. Pantaloon is expected to build about 11 super stores, moving ahead of its current store and franchise model of business. Regional retailers like Vishal mega mart and Adani are planning to expand the network across their region. Players like Crossword, Nilgiris, Vitan, Kemps Chain and Landmark are also planning expansions. So, the growth in the organized segment is evident from the plans of the current players. Households in the high-income categories account for about 53 per cent of the total household consumption expenditure. On an average the expenditure on consumables – food, clothing and consumer durables, by the lower income category is as high as 74 percent while in the higher income category this forms only 57 percent of their expenditure. Though the percentage contribution of consumables is relatively higher by the lower class, the purchase location is predominantly traditional outlets, as compared to the higher income category.
The Essay on The Secret Of Apple Stores: Retail Experience
Any successful company has a set of factors that get it to a level that other companies aim to be at. This company has not only flourished in designing the best mobile smartphone handsets, but other hand held and personal computer devices that have changed the world. The company’s success is also associated with its management and leadership which has promoted its public image and identity. The ...
Changing Trends in Retailing
Retailing in India is at a very initial stage of its evolution, but within a small period of time certain trends are clearly emerging which are in line with the global experiences. Organized retailing is witnessing a wave of players entering the industry. Organized retailers in India are
trying out a variety of formats, ranging from discount stores to super markets to hypermarkets to speciality chains. Yet, Indian retailing has still not been able to come up with many successful formats that can be scaled up and applied across India. A common element of the expansion plans of different players appears to be the hypermarket. All leading Indian retail players are either already present or have plans for hypermarkets. Some of the notable exceptions have been garment retailers like Madura Garments & Raymond’s who was scaled their exclusive showroom format across the country.
Experimentation with Retail Formats
Retailing in India is still evolving and the sector is witnessing a series of experiments across the country with new formats being tested out; the old ones tweaked around or just discarded.
Retailers are also trying out smaller versions of their stores in an attempt to reach a maximum number of consumers. A crossword bookstore is experimenting with Crossword Corner, to increase reach and business from their stores.
Retailer | Original Format | Experimenting Format |
Shoppers’ Stop | Department Store | Quasi-mall |
RPG Retail | Supermarket Food world | Hypermarket (Spencer’s), Food world express Specialty store (Health & Glow) |
Crossword | Large bookstore | Corner shops |
Piramal’s | Department store(Piramyd Megastore) | Quasi-mall, food retail, Discount store (TruMart) |
Pantaloon Retail | Small format outlets (Shoppe)Department store (Pantaloon) | Hypermarket, Supermarket (Food Bazaar), Hypermarket (Big Bazaar) Mall (Central) |
Subhiksha | Supermarket | Self service, Discount stores |
The Essay on Retailing and Department Store
Through the organized category, women can explore and sample different beauty products without pressure from a salesperson when shopping in a department store. That way, customers can take the time and enjoy more on their shopping experience. 3. Sephora was unsuccessful in Japan and Germany due to the lack of understanding of the cultural different. Their unique retail concept of self-service may ...
Vitan | Supermarket | Suburban discount store |
Globus | Department Store | Small fashion stores |
Tata/ Trent | Department store (Westside) | Hypermarket (Star India Bazaar) |
Landmark Group | Department store (Lifestyle) | Hypermarket |
Technology in Retail
All department stores have spent a lot of money on state-of-the-art IT systems, covering the entire areas of operations like merchandise management, interaction with vendors, and stock planning. This has helped these stores in managing the complexities of interacting with a large number of suppliers, running various stores and warehouses and selling a large number of products to a broad consumer base. The level of bar-code usage is also largely due to retailers’ initiatives of printing these codes at their warehouses, unlike in developed countries where all the suppliers print bar codes, this shows the eagerness to adopt new technology in Retailing.
Increasing Significance of Private Labels
A key strategy adopted globally and increasingly in India by retailers is the use of private labels or store brands. Globally private labels contribute to 17 per cent of retail sales and are growing at five per cent per annum. Private labels provide a higher margin to the retailers while simultaneously offering lower prices to consumers. Some of the major food and grocery retailers average between 20 and 30 per cent private label penetration with the highest
Penetration of about 50 per cent today. In clothing and apparel, some retailers have as much as 65 per cent of the sales coming from private labels. While private label penetration is on the rise, it is largely in the areas of groceries, home care and clothing. Internationally, private labels are available in many more categories including healthcare, cosmetics, beverages, etc. This expansion is likely to take place in India as well.
Loyalty Schemes
Most department stores operate loyalty schemes to promote repeat purchases and build a loyal customer base. Customers, who join such schemes, are eligible for a variety of benefits such as accumulation of points against purchases for redemption on subsequent purchases, special offers, product previews, quick billing and so on. Such schemes also enable department stores to analyze customer-buying patterns, which help in formulating future strategie.
Use of Concession
Several department stores are offering space in their stores to other retailers selling various products and services including music, books and coffee. This increases the range of products
Available in these stores, thus, enhancing their customer appeal without the problems related to direct retailing such as supply chain and stock management. These factors are particularly
Important in areas where there is a requirement for special expertise and experience. The new application of retailing is filled with terms like concessions and concessionaires in the global context. A concession represents a shop, restaurant, bar or car rental counter located at any space available in any Store, mall or stations like airport, Railway station and Bus depots; on a ship or at a hotel. Someone who holds or operates a concession is called a concessionaire.
Future of Indian Retailing
India’s growing middle class and its almost untapped retail industry are key attractions for global retail giants wanting to enter newer markets. It is rated the fifth most attractive emerging retail market. India is being seen as a potential goldmine. It has been ranked second in a Global Retail Development Index of 30 developing countries drawn up by AT Kearney. The retail sector in India is witnessing a huge revamping exercise as traditional markets make way for new formats such as departmental stores, hypermarkets, supermarkets and speciality stores. Western-style malls have begun appearing in metros and second-rung cities alike introducing the Indian consumer to a shopping experience like never before.
According to KPMG report “Consumer Markets in India” The organized retail sector is expected to grow stronger than GDP growth in the next five years driven by changing lifestyles, strong income growth and favorable demographic patterns. The structure of retailing is developing rapidly with shopping malls becoming increasingly common in large cities, and development plans being projected at 150 new shopping malls by 2008.
In the next couple of years, India will see at least two Indian retail businesses attaining the magic figure of US$ 218 million in sales. Interest of Government to this industry will create catalytic impact to the Retail industry and force to attain a critical mass as growth in the industry picks up momentum. The customer will continue to change will be far more demanding. The next few years will be most interesting than we have ever seen. Retailer needs to know the customer’s needs.
Conclusion
India remains one of the last frontiers of modern retailing. Various business houses have already planned for few investments in the coming 2-3 years. Though the retailers will have to face increasingly demanding customers and intensely competitive rivals, more investments will keep flowing in and organized retailing in India is surely poised for a takeoff and will provide many opportunities both to existing players as well as new entrants. Retail marketing efforts have to improve in the country advertising, promotions, and campaigns to attract customers, building loyalty by identifying regular shoppers and offering benefits to them, efficiently managing high-value customers, and monitoring customer needs constantly, are some of the aspects which Indian retailers need to focus upon a more proactive basis.
